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Monday, November 1, 2021
Mobile Doctor Sentenced to Four Years for Role in Major Compounding Pharmacy Fraud Conspiracy
Department of Justice
U.S. Attorney’s Office
Northern District of Alabama
FOR IMMEDIATE RELEASE
Tuesday, October 26, 2021
Mobile Doctor Sentenced to Four Years for Role in Major Compounding Pharmacy Fraud Conspiracy
Tuscaloosa, Ala. – A Mobile-area doctor was sentenced today for her role in a major compounding pharmacy fraud scheme, announced U.S. Attorney Prim F. Escalona, Federal Bureau of Investigation Special Agent in Charge Johnnie Sharp, Jr., U.S. Department of Health and Human Services, Office of Inspector General, Special Agent in Charge Derrick L. Jackson, Defense Criminal Investigative Service Special Agent in Charge Cynthia Bruce, U.S. Postal Inspection Service Acting Inspector-in-Charge, Houston Division, Dana Carter, and IRS Criminal Investigations Atlanta Field Office Special Agent in Charge James Dorsey.
Chief U.S. District Judge L. Scott Coogler sentenced Dr. Michelle Martine Jackson, 55, of Fairhope, Alabama, to four years in prison. Jackson was also ordered to pay forfeiture of $53,000 and restitution of $3,920,584.84. Jackson pleaded guilty in June to conspiracy to commit health care fraud.
“This defendant abused the power of her prescription pad, breached the public’s trust, and cost insurers millions of dollars as a result,” U.S. Attorney Escalona said. “Her sentence is a reminder that health care fraud is a serious crime and carries serious consequences.”
Global, a pharmacy based in Haleyville, Alabama, has been the subject of a large-scale health care fraud investigation that has resulted in nearly thirty convictions to date. The Global health care fraud conspiracy involved Global managers directing Global employees to get medically unnecessary drugs for themselves, family members, and friends, changing prescriptions to add non-prescribed drugs because insurance would pay for them, automatically refilling prescriptions regardless of patient need, routinely waiving and discounting co-pays to induce patients to get and keep medically unnecessary drugs, and billing for drugs without patients’ knowledge. When prescription drug administrators attempted to police this conduct, the conspirators hid their fraud and obstructed detection efforts—including by lying to auditors and diverting their billing through affiliated pharmacies. The scheme targeted multiple health insurance plans, including the pharmacy’s Blue Cross Blue Shield of Alabama plan, as well as plans providing health insurance to the elderly, disabled, members of the military, and veterans—Medicare, TRICARE, and CHAMPVA, among others.
As part of the scheme, certain Global sales reps paid kickbacks to medical prescribers in exchange for writing prescriptions. Michelle Jackson was one of those prescribers. As part of her plea agreement, Jackson admitted that she had received cash kickbacks for writing prescriptions. She admitted that she wrote prescriptions for Global drugs that were not medically necessary, including for the sales rep’s family and friends, individuals Jackson had never treated, and family of Jackson’s staff. For example, Jackson wrote the sales rep’s pregnant daughter prescriptions for a drug that was contraindicated for pregnant women. Jackson also pre-signed blank prescription forms to enable co-conspirators to issue prescriptions under her name simply by checking boxes on the prescription forms.
The FBI, HHS-OIG, DCIS, USPIS, and IRS-CI investigated the cases. Assistant U.S. Attorneys J.B. Ward, Edward Canter, and Don Long prosecuted the case. The Veteran Affairs Office of Inspector General Criminal Investigations Division aided in the investigation.
Topic(s):
Health Care Fraud
Component(s):
Thirteen Defendants Plead Guilty in $126 Million Compounding Fraud Scheme
Department of Justice
Office of Public Affairs
FOR IMMEDIATE RELEASE
Wednesday, October 27, 2021
Thirteen Defendants Plead Guilty in $126 Million Compounding Fraud Scheme
Thirteen defendants, including three compounding pharmacy owners, three physicians, two pharmacists, and three patient recruiters, pleaded guilty in the Southern District of Texas to a years-long, multi-state scheme to defraud the U.S. Department of Labor’s (DOL) Office of Workers’ Compensation Programs (OWCP) and TRICARE.
According to court documents, the defendants submitted false and fraudulent claims to the OWCP and TRICARE for prescriptions for compounded and other drugs prescribed to injured federal workers and members of the armed forces. The defendants also paid kickbacks to patient recruiters and to physicians to induce them to prescribe these drugs. The defendants chose the particular compounds and other drugs based not on the patients’ medical needs but in light of the amount of reimbursement for the drugs. The drugs were then mailed to patients, even though the patients often never requested, wanted, or needed them.
“The health care fraud and kickback scheme executed by these defendants manipulated federal health care programs for personal gain without regard for patient need or medical necessity,” said Assistant Attorney General Kenneth A. Polite Jr. of the Justice Department’s Criminal Division. “I applaud our prosecutors and law enforcement partners for their hard work on this investigation and prosecution. The Department of Justice is committed to holding accountable those whose unlawful conduct targets federal health care programs.”
“Last week’s guilty pleas are a testament to the dedication and determination of the investigative and legal teams,” said Acting Special Agent in Charge Jonathan Ulrich of the U.S. Postal Service Office of Inspector General (USPS-OIG), Southern Area Field Office. “The Postal Service spends hundreds of millions of dollars annually on health care related costs and these monies are critical to those who legitimately need medical services. As in this case, our criminal investigators will diligently pursue any individual or organization intent on defrauding the Postal Service with an eye on both federal prosecution and returning lost monies to the affected program.”
“These defendants put illegal profits above patients’ safety,” said Special Agent-in-Charge Steve Grell of the DOL Office of Inspector General (DOL-OIG), Dallas Region. “Last week’s pleas highlight our commitment to working with our law enforcement partners and OWCP to protect the integrity of DOL’s benefit programs.”
“As the investigative arm of the Department of Defense Office of Inspector General, the Defense Criminal Investigative Service (DCIS) is committed to protecting the integrity of the TRICARE program,” said Special Agent in Charge Michael C. Mentavlos of the DCIS Southwest Field Office. “The results of this case are a testament to the resolve of DCIS, our law enforcement partners, and the U.S. Attorney’s Office to hold individuals that attempt to defraud the TRICARE program accountable.”
The defendants were charged in a June 2018 indictment and pleaded guilty to wire fraud, health care fraud, and/or kickback charges. All 13 defendants are scheduled to be sentenced in February 2022 and face a statutory maximum sentence of between five and 20 years. U.S. District Judge Sim Lake of the Southern District of Texas will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
The USPS-OIG, DOL-OIG, and DCIS investigated the case with assistance from the U.S. Department of Veterans Affairs, Office of Inspector General.
Trial Attorneys Catherine Wagner, Patrick Queenan, and Jay McCormack of the Criminal Division’s Fraud Section are prosecuting the case. Trial Attorneys Scott Armstrong, Sarah Edwards, John Scanlon, and Michael McCarthy of the Fraud Section previously prosecuted the case.
Topic(s):
Health Care Fraud
Component(s):
Press Release Number:
21-1056
Wednesday, October 20, 2021
Doesn't the ruling that the percentage of compounded drugs sold interstate was arbitrary force the FDA to then use the amount selected by Congress which is 5% or more? Why or why not? More importantly doesn't it just fortify the argument that the federal government/FDA should regulate any compounded drugs sold in interstate commerce? Why or why not?
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